Friday, January 18, 2013

An open letter to Anthony Jenkins at Barclays Bank.

Dear Mr Jenkins,

I have heard it
reported that you have told the bank's 140,000
employees to sign up to a new code of conduct, or leave.

This is a very brave act on your part, albeit far too little and
far too late, but better than nothing. For far too long, you all laboured under
the malign influence of Don Roberto, who focused you all on short-term gains to
the greater detriment of your longer term ambitions, you clients, your values,
and ultimately, your reputation. For 20 years Barclays manifested an increasingly aggressive
work culture, which, I am now told, you recognise as focusing too much on
making a quick buck instead of upholding the values and long-term reputation of
the bank.

Why didn't you say all
this when the Godfather was at the helm? Was it politically not expedient? Why
didn't you stand up in front of the Board and put it to them that they were
behaving like a second-rate loan sharking enterprise? You could have done so,
although I wouldn't have given a brass razoo for your chances of keeping your
job very long. How much money did you earn in bonuses for staying shtum all
those years, you can probably begin to see why I am not all that impressed by
your Damascene conversion to the straight and narrow all of a sudden!

Your Private Banking arm
was so bent that a friend of mine who was briefly head of anti-money
laundering, left, because as he put it, he wanted to get back to knowing how it
felt to sleep at night.

Between you all, and you were part of the management structure
at the time, let us not forget that, you took a once-proud and major bank, and
you trashed it. Bob, 'The Capo' Diamond had to quit over Barclays' role in
rigging the Libor rate used in trillions of pounds of financial contracts. You
were just the first of several international banks to be implicated in this
particular scandal, and you were fined a total £290m by US and UK regulators.
You got off cheap!

Worse still, you,
along with most of the other major UK High Street lenders, has also been found
culpable in recent years of defrauding large numbers of your customers by
cheating them with unnecessary payment protection insurance to mortgage
borrowers, and overly complex, over-priced interest rate and currency hedges to
small businesses.

You have now got some
very hard miles to cover to bring your institution back to where the public
will trust it once again.

I am told that your requirements are that staff now sign up to five key
values - respect, integrity, service, excellence and stewardship.

These are
fine-sounding ambitions, Mr Jenkins, but what do they mean in an institution
such as yours which has rejected all respect it may have held for its
customers; lost any integrity it might once have possessed; failed repeatedly
to give good service to its clients; forgotten the meaning of what it means to
provide excellence; and failed to demonstrate anything remotely like
stewardship for years.

I have bitter
experience of the way you treated your customers, I used to be a client of
yours, and I would never, repeat never, willingly renew that relationship.

I am told that these
demands of yours come at the same time as staff prepare to learn what bonuses
they will receive for their services in 2012, and that bonuses in future will be
assessed against the new "Purpose and Values" criteria.

In my judgement you
have already failed my first test of true sincerity. What bonuses are you
intending to pay this year? What have any of you done to deserve any bonus
payments. Bonuses are supposed to reflect good work, added value, integrity, going
the extra mile.

What has 2012
signalled for Barclays? Fines for LIBOR rigging, Fines in the US for
electricity market pricing fiddling, I mean how much more criminality are you
willing to condone before you decide not to reward it with bonuses. There are
hundreds of thousands of hard working men and women in this country, many of
them your customers, God help them, whose salaries have been pegged, cut back,
frozen and who have not seen an increase for some time. Their costs of living
are going up, their children are facing massive debts for university education,
something you would have got for free, their elderly parents are wondering
whether this Government of your friends are going to remove their winter fuel
allowances, and their bus passes, and you are talking about paying bonuses to
your organised criminal employees! Have you lost your entire sense of
proportion, man!

I know you have been
talking tough to some of your crooks and spivs, telling them "There might
be some of you who don't feel they can fully buy in to an approach which so
squarely links performance to the upholding of our values."

I guess you thought it
sounded messianic when you said, "My message to those people is simple:
Barclays is not the place for you. The rules have changed. You won't feel
comfortable at Barclays and, to be frank, we won't feel comfortable with you as
colleagues."

Well, you are going to
have to prove that you can walk the walk as well as just talking the talk. You
failed another test of integrity when you appointed Hector Sants, former boss
of the Fantastically Supine Apologists, to head the new Barclays' compliance
department.

I don't quite know
what you think that ' great big soppy old Hector' is going to do for your new
image, he was asleep on his watch at the FSA, or so the Parliamentary Select
Committee found, and you then went and rewarded him with some massive pay deal.
No doubt he will be part of the new package which you are reported as saying would "excite" the workforce.

So, as part of my
message to you, I thought I might send you some good ideas with which to
underwrite your new squeaky-clean image.

First, get together
with your Department Heads, and your HR department, and demand to be given a
list of all the highest earning staff members in terms of bonuses and commissions,
and then get rid of them, fast.

These are the people
who will have been causing you most of your problems in terms of cutting
corners, cheating the rule book, ignoring the regulations, rigging LIBOR, etc,
etc. By sacking them, you will send a very loud message to the rest of the
teams that you really mean what you say about starting the way you mean to go
on, and it will have a salutary effect. Most of these really high-earners are
routinely loathed by their peers who see them as cheats and liars who are being
allowed to prosper.

Remember, most people
like working in an ethical environment. I know I know, after all these years of
working for the most crooked bank in the High Street, to suddenly learn that
the vast majority of staff like working in an ethical workplace must come as
something of a shock, but it is true!

Next; buy in some
top-notch training in ethics, integrity, honesty and commercial morality and
insist that every employee from yourself, down to the office cat attends. Don't
give this project to one of the BIG Four consultancies, bring in someone from
outside who really specialises in proper ethics consulting.

While on the topic of
the Big 4, radically curtail the amount of money you spend on them, because in
most cases they are not part of your solution, they are part of your problem.
You should be capable of employing good staff who have the necessary experience
to be able to deal with most of these issues without having to spend the amount of money you do on
the Big 4. They are a waste of time and space and they cost you a fortune. They
are in the business of consolidating so many of your bad practices and bad
habits, and you can get by without them. If you doubt this wisdom, read an
incredible book entitled, 'Dangerous Company' by James O'Shea and Charles
Madigan and realise why you don't need to spend the money these people cost
you.

When it comes to
recruiting staff, stop spending money on recruitment agencies, they are another
parasite industry who are draining you of revenue. They employ young people
straight out of university to engage in a box-ticking exercise when it comes to
recruiting staff. Do it yourself, that's what your HR division is for.

Pay particular
attention to the quality of your compliance and Anti-Money Laundering teams, and make sure you hire the very best
people you can. Pay them well, and understand the value of age and experience.
Don't rely on loads of wet-behind-the-ears kids who are paid peanuts, but who
become another box to be ticked by the regulator. Hire quality and experience,
and stop being so ageist! Just because someone is over 55 doesn't mean they
have forgotten all they ever knew. Pay a premium for skills and experience, and
look for grey haired people who can offer proper mentoring for young people,
helping keep them off the crooked path.

Remember, managing
people is like herding cats. Every single person is different, so make sure you
reward common traits. Reward honesty, integrity, and adherence to best
practice, and watch very carefully for signs of the 'star performer'.

Rigidly demonstrate a
commitment to an anti-bullying program in the workplace. Bullying is one of the
most commonly corrosive and damaging influences in the workplace these days. Instigate
a programme of in-house training to encourage staff members to identify
bullying, and help stamp it out internally. The same goes for sexism, racism
and any other kind of exclusionary behaviour.

In your trading rooms,
make sure you discourage any signs of sexist conduct against staff. Do not be
willing to condone 'laddish' behaviour which all too often is aimed at ambitious
women, seeking to destroy and undermine their effectiveness and efficiency.
Stamp out any such behaviour ruthlessly.

Encourage regular
medical examinations for signs of excessive drink or drug abuse. Too much money
has been lost because the trader or broker bolstered his pathetic ego with a
snort of Colombian marching powder or a drink too many. Make drink and drug
testing in the dealing rooms the same as if these staff were Olympic athletes.
They are supposed to be the best in the market, or so you repeatedly tell us,
so treat them as such and make sure they are not short-changing you.

Encourage staff to
obtain additional educational qualifications through part-time study,
day-release, night school, etc, and reward it. You are allowing them to add
value to their personal work-life balance, you are encouraging them to educate
themselves to acquire higher skills and knowledge and they will reward you for
this commitment. In addition, encourage staff to undertake meaningful voluntary
work in the local community, whether working with children who have reading
difficulties, or helping old people who need extra assistance. Whatever the
model, make sure it is recognised as being part of the firm's ethic and ensure
it is suitably rewarded.

Make bonuses mean
something. Instead of dishing out hundreds of thousands of pounds, all of which
merely encourage staff to adopt the shortest of short-term policies, pay fair,
but small bonuses, no more than a couple of thousand pounds at the most, and
only then for real evidence of integrity, ethical or honest conduct. In this
way, staff will not need to behave in unethical or illegal ways, just to guarantee
getting their bonuses.

Finally, make sure
that the legal compliance requirements of the lead regulator are implemented
properly and in their entirety. Encourage a dialogue with both the regulator
and the criminal intelligence services who rely on suspicious financial disclosures,
and enter into gateway agreements with them to ensure that the rules on
compliance and money laundering are being adhered to. Share your experiences
with them, and stop the present atmosphere of distrust and contempt from
growing.

If you can do these
things Mr Jenkins, you might just have half a chance of succeeding. For my
money, I remain to be convinced. Leopards and spots comes to mind all too
easily.

16 comments:

A good comment from Elaine. I hope you have sent it as it is cogent, accurate and 'on message'. Barclays like many other banks needs a thorough clean out and I doubt very much Jenkins has the balls to do it. He will merely close his eyes and ears and pick up his fat salary each month. The fact that he is prepared to lead a company convicted of serious criminal activity and not seek out and remove those responsible says it all.

Possibly the most sensible letter to Barclays I have ever seen - I worked for them for 27 years in the IT department and I could write a book on Barclays ! In the 80's it really was about customer service (they used to send us on loads of customer service courses all the time) they lost their way in the last 10 years courtesy of American top dogs and USA and UK fiscal incompetance. (Bob Diamond wasnt the first American who started screwing Barclays by the way). Can you post a reply to let us know if this has gone to AJ as if it hasnt I will send it - his reply would be interesting.

Thank you to all of you who took the time to write your observations on this post. I have not sent this to AJ because I do not feel it is a blogger's place to single out individuals for special treatment, it smacks of bullying on my part. Even if I had sent it, I doubt he would have seen it, people like him have ways and means of insulating themselves from publications such as mine. However, if any of you know of ways to bring this blog to his attention directly, then please be my guest!

About Me

Having spent my career dealing with financial crime, both as a Met detective and as a legal consultant, I now spend my time working with financial institutions advising them on the best way to provide compliance with the plethora of conflicting regulations and laws designed to prevent and forestall money laundering - whatever that might be! This blog aims to provide a venue for discussion on these and aligned issues, because most of these subjects are so surrounded by disinformation and downright intellectual dishonesty, an alternative mouthpiece is predicated. Please share your views with what is published here from time to time!